Atlanta job growth strong in October to start holiday season

Hints of trouble down the road as interest rates stay high
CarMax plans to hire 100 techniciains for a new reconditioning center in Carrollton, a business aimed at appealing to consumers buying used cars. The company says it plans to hire 100 more next year. Courtesy of CarMax

Credit: cus

Credit: cus

CarMax plans to hire 100 techniciains for a new reconditioning center in Carrollton, a business aimed at appealing to consumers buying used cars. The company says it plans to hire 100 more next year. Courtesy of CarMax

Metro Atlanta outdid the rest of the state in job growth in October, a sign that despite the pressures on consumers and companies alike, holiday spending in the region started strong, according to the Georgia Department of Labor.

The region added 23,500 jobs last month, 84% of the state’s expansion, the department said.

October is historically a month in which holiday hiring gets traction and metro Atlanta was true to that pattern. Growth was most robust in sectors affected by seasonal spending and the movement, storage and delivery of goods — transportation, warehousing, retail and hospitality.

Metro Atlanta has added 64,900 jobs during the past 12 months and 180,000 jobs in the past two years, 71% of the state’s growth, according to the Bureau of Labor Statistics.

Yet with interest rates high, there are some disquieting omens.

Holiday spending will be 3% to 4% above last year’s, but that is slower growth than in 2022, according to the National Retail Association. And much of that spending may be money diverted from other purchases.

During the month, the number of Atlanta jobs in repair and maintenance fell, perhaps a sign of consumers cutting back on home improvements. Moreover, some job growth seems to be from businesses that appeal to frugality.

For example, new car sales have been weak. CarMax, the nation’s largest retailer of used cars, plans to open a reconditioning center, which will be located in the Metro-Atlanta area, in Carrollton. CarMax plans to hire up to 100 technicians by February and 100 more after that, the company said.

And while monthly hiring was solid, the overall trajectory has been drifting downward. In the past year, the number of metro Atlanta jobs has grown by 2.14%. A year ago, the pace of 12-month job growth was at 6.43%.

“The reality is, things are not terrible, but they are not so great,” said Amy Crews Cutts, economic consultant to Primerica, the Duluth-based financial services company.

The drag has come in the form of a two-year Federal Reserve campaign to stymie inflation by raising interest rates. And while inflation has fallen to nearly pre-pandemic levels, interest rates are the highest they have been since March 2001.

Higher rates make borrowing more expensive, which tends to chill sales of homes and vehicles, while tempering the eagerness of many companies to expand. That tends to slow the economy, so similar rate-hiking efforts have historically often led to recession.

The predictions in mid-2022 of most economists predicting a downturn have not come to pass. But households have not made up ground they lost in the months of high inflation, which has led to rising credit card debts and delinquencies on loans, said Cutts.

Companies that are seeing less demand have delayed layoffs, but that may soon change, she said. “I think we are likely to see more corporate layoffs as firms try to manage their costs in the fourth quarter.”

The Conference Board, a national business group, predicts the U.S. economy will grow 2.4% this year, decelerating to 0.8% in 2024.

Another warning sign in October’s data is a decrease in the number of people in Atlanta’s workforce, something that usually doesn’t happen when holiday expansion is strong. The dip could be caused by boomer retirements or it could mean that some parents faced with rising costs of child care think it doesn’t pay to work.

The labor force — everyone either working or looking for work — has grown by 76,282 during the past year. Still, employers in some sectors are already scrambling to find the people they need, said Bruce Thompson, the state’s commissioner of labor.

The unemployment rate, which counts only those actively searching for a job, remained at 3.4% in October, same as the previous month. And there were 49,500 job listings in the metro area, he said.

“Businesses face growing pressure, including finding and retaining top-tier talent,” Thompson said.

Yet some employers are not worried by either talk of a downturn on one hand or the challenges of finding enough good workers when the economy is strong.

Joshua Tree Experts hopes to soon begin operating in metro Atlanta, said Dylan DeGroat, director of the Pennsylvania-based company’s franchise development.

Members of a tree team make between $20 and $40 an hour, depending on role, experience and certifications, he said. “We don’t anticipate an issue in finding people.”

“We reach out to look for them, we don’t just depend on the job postings.”

One potential obstacle is the start-up cost. Even with a loan, a franchisee may need to front $360,000, and interest rates make the monthly payments higher. But once it is launched, the business is “very recession-resistant,” DeGroat said. “If you have a large tree leaning over your house, it doesn’t matter if there’s a recession or not.”

October job changes, metro Atlanta

Pre-pandemic best: 29,600 (2015)

Pre-pandemic worst: -12,400 (2001)

Pre-pandemic average: 12,000

Recent: 23,500 (2023)

Metro Atlanta as share of state

Share of Georgia population: 57.0%

Share of Georgia jobs: 62.5%

Share of Georgia job growth, 2021-2023: 70.3%

Share of Georgia job growth, 2002-2023: 76.9%

Share of Georgia job growth, October: 83.6%

Atlanta, growth over previous 12 months

Oct., 2022 3.9%

November 3.6%

December 3.4%

January 3.9%

February 3.3%

March 3.1%

April 2.6%

May 2.4%

June 2.8%

July 1.8%

August 1.8%

September 2.2%

Oct., 2023 2.1%

Sources: Bureau of Labor Statistics, Georgia Department of Labor, Census Bureau